In case you forgot, crude oil prices are still at astronomical prices.
As of writing, WTI futures are trading at $114 per barrel, while Brent crude futures are trading at $117 per barrel.
Over Thursday trading, both assets loaded more than 3% onto their already elevated prices. Higher prices are being driven by strong oil demand, while tight supplies and oil embargoes threatening further obstacles for the industry are not abating.
According to the Bank of America Global Research report, oil inventories across the US and Europe are at “Dangerously low” levels. The report went on to warn that its prediction for Brent oil to be priced on average at $102 per barrel over 2022 and 2023 is now questionable. As of writing, the 20, 50, and 200 day moving average is at $110, $108, and $90 per barrel, respectively.
Factors that the report cites include a downturn in oil demand as global economic condition worsen (particularly in Europe and the UK), and the EU finally coming to an agreement to ban Russian oil. The latter issue is being held up by Hungary, which is requesting almost a billion dollars to upgrade its oil refineries before agreeing to restrict Russian oil imports into Europe.
With Thursday’s price rises, both WTI and Brent futures have both decisively broken out of a recent swing area on the hourly chart. In the case of WTI, the instrument spent most of its time in the top half of the $108.00 to $112.00 range, dating back to May 19. The last time the price broke above this range was on May 16, reaching a peak just above $115 per barrel, but this break-out could only be sustained for 2 days before succumbing to selling pressure.